Shmaltz to Open Production Brewery

Chris Furnari

Mar. 22, 2013 at 10:04 AM

After 16 years of championing the contract brewing business model, Shmaltz Brewing founder Jeremy Cowan has opted for a more traditional approach.

A Jewish-themed craft beer company with offices in both San Francisco and Brooklyn, Shmaltz will be able to call Clifton Park, New York home when it opens its first brick and mortar facility next month.

Shmaltz had previously contract-brewed its beer at The Olde Saratoga Brewing Company in Saratoga Springs, NY..

“It’s a perfect time, given our barrelage and sales trajectory, to take over our own production,” said Cowan. “We wanted to secure our production and be completely free to do everything we want to do with the beers we want to produce.”

Shmaltz has invested $3.25 million into an 18,000 sq. ft. facility, which features a 50-barrel brewhouse and a brewery capable of producing up to 20,000 barrels. A combination of bank loans, reinvested profits and private investment from family and friends was used to finance the project, Cowan said.

It’s a strategic turnabout for one of the industry’s most stalwart proponents of the idea that craft beer and contract production are not mutually exclusive.

“Though I am a big believer in the contract business model, for our current business, it was too risky not to control our own production,” he said. “It was also too exciting not to jump at the chance to nurture 100 percent of our own production.”

Cowan believes that having the flexibility to control the company’s own production will lead to more sustainable, long-term growth.

“For the first time ever, we will have a retail outlet and be able to host customers and present our beers in exactly the way we want,” he said. “That is something that has been missing from our brand for a long time. It also protects us from the risks of having our production in the hands of another company.”

Over the next few months, Shmaltz will begin slowly phasing out production of its beer from the Olde Saratoga facility while simultaneously phasing-in production at the Clifton Park location. Current packages —draft, 12 oz. and 22 oz. bottles — will go unchanged, Cowan said.

“I am hoping that people will take us more seriously now as just great, high-end craft beer instead of that confusing contract brewed story of a guy who lives in San Francisco for part of the year and Brooklyn for the other part of the year,” Cowan said.